Surviving the Global Recession and the Demand for Auto Industry in The U.S. – A Case for Ford Motor Company

Norikatsu Hiraide, Kalyan Chakraborty

Abstract


The world economy has been severely affected by the global recession which started from the second quarter of 2007 triggered by the financial crisis. The auto industry in the U.S. faced the most severe difficulties which threatened its survival after the recession. In the U.S. especially the “Big 3” the General Motors, Ford, and Chrysler struggled to stay in the business. This paper analyzes the impact of recent downturn on U.S. auto industry in general, and the demand of Ford vehicles in particular. The study also discusses the past and present performance of Ford Motor Company in the light of changing economic conditions at home and abroad. The empirical study uses twenty years sales data to estimate a time-series demand model for Ford vehicles.The study found that the demand for automobiles in the U.S is positively related to non-farm employment and single family housing start and negatively related to gas price and vehicle price.

Full Text: PDF DOI: 10.5539/ijef.v4n5p85

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This work is licensed under a Creative Commons Attribution 3.0 License.

International Journal of Economics and Finance  ISSN  1916-971X (Print) ISSN  1916-9728 (Online)

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